Sourcing palm oil responsibly

Last updated: 5/06/2019

Palm oil is the world’s most widely-traded and versatile vegetable oil. Indonesia and Malaysia account for 86% of global production, while India, China and the EU are the three largest consumers (38%).

The Palm Oil Sustainability Challenge

Palm oil is an extremely efficient crop, producing up to ten times more oil than other oil crops per unit of cultivated land. However, as the world population increases, global demand for vegetable oils, including palm oil is also expected to grow, placing considerable pressure on the world’s forests and other native habitats. Palm oil has the greatest potential to meet the growing global demand for vegetable oils with the least amount of land than any other oil crop. However, the development of oil palm plantations has been a major driver of global deforestation, climate change and biodiversity loss. Addressing these challenges requires sustainable production that ensures any future expansion protects forests, peat lands and other native habitats.

Palm oil production is driven by a range of producers, from large plantation companies to small-scale family farmers. Achieving sustainable production requires the engagement of all producers. Large plantation companies are making significant progress in addressing deforestation in palm oil production, for example through sustainability certification. However, to meet the palm oil sustainability challenge, certification standards need to be continuously strengthened. Additionally, smallholders, who represent 40 per cent of global production must be supported to transition to sustainable production.

In order to achieve sustainable production, producers and supply chain customers need effective forest governance. Producing and consuming nations need to enable the development and implementation of national sustainable palm oil initiatives.

Tesco can contribute to addressing these sustainability challenges.

Our Approach

Tesco is committed to zero-net deforestation in our sourcing of palm oil. As members of the Consumer Goods Forum (CGF) we have committed to achieve this by 2020. We have also committed to sourcing 100% certified palm oil (Tesco Own Brand products) as a member of the Roundtable on Sustainable Palm Oil (RSPO).

Beyond our supply chain, we work collectively at an industry level and with other stakeholders (such as NGOs and governments), because we recognise that developing the right conditions for a sustainable palm oil market requires effective collaboration.

Advocate: mobilising others for action

We will work with others on engagement to supporting national initiatives by producing and consuming countries.

Progress

100% of our Tesco UK products RSPO certified in 2018.

For the 2018 calendar year reporting period, 100% of the palm oil used in our Own Brand products in the UK was certified by the Roundtable on Sustainable Palm Oil (Segregated - 71%; Mass Balance - 26%; RSPO Credits – 2%).

We are working to transition the 2% of RSPO Credits to a physical supply chain of certified sustainable palm. This is predominantly within our non-food products range where physical supply chains for complex derivatives continue to be more challenging to establish.

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